High-end athleisure company Hylete has agreed to acquire rival Gracedbygrit in an all-stock transaction, a move that will immediately capture a larger share of female shoppers.

The deal should be accretive to earnings within a year and may herald future acquisitions, Hylete Chief Executive Officer Ron Wilson told RegAReseach in an interview. “We could see more opportunities after this,” he said.

Mr. Wilson said that the company has had success acquiring customers organically with advertising on social media platforms such as Facebook. But in recent months, the cost of effective Facebook ads has increased, making it more efficient to pick up new customers with an acquisition, he said.

Gracedbygrit, founded in 2013, has about $1 million in annual revenue and 20,000 customers. That compares with Hylete’s forecast of $12 million to $15 million in sales this year and over 120,000 customers. Hylete currently generates only 15% of its sales from women’s apparel.

The deal comes as Hylete has been raising money to fund growth. The company, which is currently selling up to $6.25 million in stock, this week also launched an offering of up to $5 million in five-year 12% bonds. The investment portal, which uses technology from WealthForge, can be reached here.

Hylete has raised about $8 million through various offerings under the JOBS Act. The stock isn’t currently listed but Hylete is considering an initial public offering next year.

Hylete’s acquisition strategy sets it apart from larger rivals. The likes of Nike, Lululemon, and Under Armour have only made a few acquisitions and they were completed when the companies were more mature. Under Armour, which had $5 billion in sales last year, has made $710 million in acquisitions, according to Edward Jones of Dealogic. Nike, which had $34 billion of revenue last year, has spent $1.3 billion on acquisitions.

Indeed, Hylete’s approach to M&A is more akin to a tech company’s than an apparel maker’s. The company seeks to win over highly-engaged shoppers who make frequent purchases. Mr. Wilson draws an analogy to Facebook’s acquisition of Instagram. Gracedbygrit “is just different enough from us to add value to the combined entity,” he said.

In a way, investing in Hylete is like owning the e-commerce side of Lululemon, whose shares are trading at an all-time high. A big explanation for the surge in Lululemon’s stock has been the success of its Internet business, whose sales rose 42% in the first quarter. But while that’s valuable to Lululemon shareholders, e-commerce is only a fifth of total revenue at the company.

Hylete, meanwhile, is entirely focused on direct-to-consumer Internet sales. That suggests the business may eventually have even higher margins than Lululemon. The latter company has said the lack of rent and other in-store expenses make operating margins about 1,700 basis points higher in its e-commerce division.

What’s more, Hylete has an approach to design and manufacturing that probably makes it less risky than Lululemon. Called “Hylete Project,” the company frequently pitches new designs or color schemes to customers and allows them to buy them early at a discounted price. If a particular item doesn’t get enough support in advance, Hylete doesn’t produce it. In a similar spirit, the company carefully analyzes survey data before cutting cloth for a new design.